Healthcare Options for Pre-Medicare RVers

[00:00:13.000] – Georgianne

Hi, everyone. Welcome to Escapees webinars. Tonight, we’re chatting with David Goldstein, who is one of our staff members who is also very well informed on health care options for pre-Medicare RVers. And so he has offered to join us tonight to talk a little bit more about that. I want to thank you all for coming and sharing your evening with us to learn a lot more about this. I know this is a really tough topic that is changing all the time.

[00:00:43.260] – Georgianne

And so we’re really grateful to have David here. Just a couple of quick little housekeeping things: If you have any questions as David goes along, feel free to go ahead and add them to the comments here on Facebook and we’ll get to them. David’s agreed to do a Q&A at the end of his presentation, so we’ll get to those questions. And also, if you need any clarification on some of the words that we use and talk about, insurance might not be familiar to you, especially if you’re newer to RVing.

[00:01:10.770] – Georgianne

And so feel free to even ask questions like that and we can take a step back that can clarify something if we need to make sure that you’re able to keep up with us. And so we’re really excited to have you here. Thank you so much for joining us for this webinar. David, you want to take a moment to introduce yourself and then let’s  hear about health care options for RVers.

[00:01:30.390] – David

All right. Thanks, Georgianne, and thanks, everybody, for joining us tonight. So I am an RVer, just like you. I am. I don’t work in the insurance industry. My wife and I have been on the road four and a half years now, full-time. I’m now 59. I was 55 when we started RVing and as my wife frequently reminds me, she will always be younger than me. I’m a recovering lawyer, spent most of my career when I was working full-time as an entrepreneur and I retired when I went on the road and now work part-time for Escapees.

[00:02:06.180] – David

But I want to mention that what I’m talking about here are really my own opinions. My wife and I lead the Hangouts program, which absolutely has nothing to do with health insurance. So what I’m telling you here is just as a fellow member. I got all this information I had to navigate all these options myself back at the end of 2017, when my Cobra from my job was running out. I had to figure all this out and it was just amazing that there were not good resources out there.

[00:02:34.560] – David

So I took all the stuff that I learned and tried to distill it down into this presentation. So what we’re going to cover tonight is the following. First of all, we’re going to talk about some important health care concepts just to get some definitions under our belts. We’re going to talk about the available options for health care coverage. And notice, I’m not calling that insurance because some of the options are insurance and many of them are not. We’re going to talk about subsidies under the Affordable Care Act.

[00:03:06.240] – David

We’ll talk about how to choose from the different options that are available. And at the end, I’ve included a couple of pages of resources, links to various things on the Web that you might want to explore for further information. There’s a ton of information in here. And so I’ve put a PDF copy of this presentation on our Dropbox at the link that you see on the screen. And then Georgianne and Jeannie will post that also in the chat from time to time so that you have that.

[00:03:37.770] – David

So you don’t have to worry about trying to write down every single thing I say. All right. So here we go. This is according to Dante, what was written over the gates of hell abandon hope all ye who enter here. And it seems appropriate for our discussion about health care options because this can just be mind-numbing stuff and there’s a lot of it. So bear with me. We’ll answer questions at the end. As Georgianne said, type your questions in whenever you have a thought or comment, something that you want clarified at the end.

[00:04:15.300] – David

And we’ll get to most of those at the very end of the broadcast. Alright. So as promised, let’s start out with some important concepts for RVers. What we’re talking about, health care. I want to start with what is the purpose of health care coverage? The purpose of health care coverage is not to cover your routine medical expenses. I hear some people say, particularly if people who are in their 20s, 30s, 40s, I’m young, I’m healthy, I don’t take any prescription medications.

[00:04:49.500] – David

I don’t have any chronic illnesses. I don’t need to worry about health care coverage. And really nothing could be further from the truth. They are thinking of health care coverage as something to defray routine medical expenses, and that’s not really what it’s about. The purpose is also not to avoid the tax penalty. There used to be a tax penalty under the Affordable Care Act if you didn’t carry insurance. That went away in 2019. So we don’t have to worry about that.

[00:05:16.380] – David

So the purpose of having health care coverage is to cover potentially catastrophic, unexpected loss. The key word there is unexpected, things you can’t foresee due to either a severe illness or traumatic injury. So what are we talking about here? Things like cancer, stroke, or heart attack. There’s a pandemic going on that affects some people pretty severely and that can hit anybody. Those things can hit anyone, regardless of your health or your age. Covering routine benefit, sorry, routine expenses is a nice side benefit, but it shouldn’t be the primary consideration for choosing a health care plan unless you have a chronic illness that you know of that requires a lot of care or brand name prescriptions or something like that.

[00:06:04.640] – David

So why do we care? Well, if we don’t have coverage, we have two big risks. One is that some providers- when we’re talking about providers, we mean hospitals, doctors, emergency rooms, things like that. Providers may refuse to offer services if you can’t prove an ability to pay the bill. And in general, that means having some kind of insurance. Now, policies vary widely, but you really don’t want to take that chance. The other reason is to keep yourself out of financial disaster.

[00:06:37.820] – David

As the quote says here, nearly 60% of people who filed for bankruptcy cited medical expenses as one of the reasons more than home foreclosures or student loans, because these are unexpected and they get out of hand very, very quickly. And so the question I ask people who say I don’t need health insurance, I’m young, healthy is do you really want to play Russian roulette with your future? Because sooner or later, one of these things will probably catch up with you.

[00:07:05.300] – David

Second concept to understand is nationwide access. And this is particularly important to us as RVers because we travel most people are in there who live in the sticks and bricks. They’re in their home state pretty much all the time. They may have an emergency when they’re on vacation, but generally for they get a sore throat or something like that, they can go to a provider in their state. We don’t have that luxury. We’re traveling all the time.

[00:07:31.370] – David

And so one of the things we are really interested in is do I have access to the provider network outside of my home state? Now, this is sometimes difficult to determine from the information that the insurers or other organizations provide. And so ask them if you’re not sure if I need to see a doctor for a routine thing and I’m not in X state, am I still covered and is there still a network? What you want to look for in the literature is something like “this plan provides access to a nationwide provider network.”

[00:08:05.540] – David

If you see words like that, it’s pretty much sure that you’re going to have nationwide coverage. You also want to look at the type of plan, whether it’s an HMO, a health maintenance organization, or a PPO or EPO, which is a preferred provider organization or exclusive provider organization. And for our purposes, we’re going to consider those last two the same thing, even though they’re slightly different. The problem with an HMO is that they use a primary care physician that you have to designate as a gatekeeper before you can see any kind of specialist and that person’s going to be in your home state.

[00:08:39.860] – David

So that makes it kind of impractical for people who travel because you can’t always get back to your home state to see your PCP first before you go to see a gastroenterologist or whatever specialty you need. In addition, a lot of HMOs and even some PPOs and EPOs, provide no coverage outside their home state except for emergencies. True insurance will always cover you for an emergency out of state. But the definition of what’s an emergency can be really narrow. Basically, if it’s something that’s life-threatening, then your true insurance will cover you no matter where you are.

[00:09:16.400] – David

But they may require you, depending on the policy, to travel back to your home state for follow-up care. And as RVers, we really don’t want to have to do that. If you happen to be in Washington state and you’re domiciled in Florida, that’s a long trip to make when you’re sick or you’re not feeling well. So nationwide access is important. Third concept that’s important for RVers is domicile. We’re all if you’re a full-timer or even a part-timer, you’re probably already familiar with the concept of domicile.

[00:09:44.990] – David

What’s relevant here is that you have to get health insurance coverage or health care health care coverage in the zip code of your domicile. Where you live, in terms of both state and county, may drive your choice of domicile, and even where you live within the state. If you’re thinking about a domicile change to another state, you need to really understand what health coverage options are available to you, where you are, and compare those to where you’re thinking about changing.

[00:10:23.060] – David

You might find, for example, that you’re thinking about changing to Texas. Texas really does not have very good non-group coverage options for RVers because there’s not access to nationwide networks on the individual plans that are offered. You might find that even though Texas is attractive because it doesn’t have an income tax and it has low sales tax and some other things that your current state of domicile might actually offer better options for you, for your particular circumstances, even though it might not otherwise be as favorable.

[00:10:57.650] – David

Maybe there’s a small income tax you have to pay to the state, but that might be more than offset by savings in premiums, so make sure you check that out and you actually get quotes for whatever zip code you’re going to be domiciled in. The next concept to talk about, and we’ve mentioned it already a couple of times, is the Affordable Care Act, and you may know this as Obamacare. I will refer to it sometimes tonight as the ACA just because it slides off the tongue a little easier.

[00:11:27.600] – David

The thing is it permeates everything to do with actual medical insurance nowadays. And we’re going to talk a lot about that. But what I want you to understand about the ACA is that it is much more than just subsidies for low- and middle-income people. It provides numerous consumer protections for plans that comply with the requirements of the law. Now, the downside of the ACA is that for traditional insurance, it’s caused higher premiums for a couple of reasons. First of all, because it requires fairly broad coverage.

[00:11:59.490] – David

We’ll talk about that. And the other is because of the political uncertainty that has swirled around the ACA for the last several years. And the issue there is insurers have to set their rates at the beginning of the year. They don’t know what’s going to happen, what Congress is going to do in any given year or so. They bump their rates up somewhat to accommodate that risk. I will tell you that at least our experience is that the ACA plan premiums have stabilized a little bit in the last few years.

[00:12:29.640] – David

In fact, the plan that we’ve been on for the last two years actually decreased about seven dollars a month for 2021. It’s not a lot, but it’s a decrease. I’ll take it. Now, I’ve mentioned ACA-compliant plans and non-compliant plans. So what’s the difference? Well, there’s several different important areas where the two kinds of plans differ and we’re going to talk about both groups. So one is that ACA-compliant plans are regulated by federal law.

[00:13:01.200] – David

They are kind of, by definition, insurance. Non-ACA-compliant plans may or may not be regulated. And the extent to which they’re regulated depends on the type of plan and the state and how they are on those kinds of plans. So you’re getting the benefit of more regulation with an ACA-compliant plan. An ACA-compliant plan has to cover 10 essential health benefits. We’re going to look at those on the next slide. But non-compliant plans often omit one or more of those benefits like mental health, substance abuse, wellness checks, things like that.

[00:13:36.950] – David

Couple of the biggest things on the ACA-compliant plans. You are guaranteed, guaranteed to be accepted. You cannot be denied for an ACA-compliant plan, whereas on a non compliant plan, you can. You’re going to go through a process called underwriting, where they’re going to ask questions about your health and they may decide to either not cover you or charge you more. ACA-compliant plans are always renewable. You are guaranteed that when at the end of the plan term, you can renew that plan for another year, even if your health has changed.

[00:14:07.200] – David

Whereas on a non-compliant plan, the insurer may be able to refuse to renew you due to changes in your health during that term. The biggest thing, the one that you hear is the political hot potato right now, is coverage for pre-existing conditions. Under an ACA-compliant plan, pre-existing conditions must be covered under a non-compliant plan. They usually are not. And this is one of the reasons why the ACA made premiums go up is the requirement to cover pre-existing conditions.

[00:14:39.300] – David

Non-compliant plans will usually exclude pre-existing conditions for anywhere from one to five years or possibly cover them never. Another difference ACA-compliant plans have unlimited lifetime benefits. Non ACA-compliant plans usually have a lifetime cap on the most that they’ll pay and maybe an annual cap as well. Why does this matter? Well, what if you have a serious injury or serious or chronic illness that requires millions of dollars in treatment? Hopefully nobody listening to this ever has to go through that.

[00:15:14.970] – David

But this is why you buy insurance, right? On most of these non-compliant plans, your lifetime benefits are going to be limited to one to three million dollars. And after that, you’re out of luck. So that’s something really to look at. It’s not necessarily a huge consideration for somebody who’s in good health, but something to think about. Now, a couple of downsides. ACA-compliant plans do not allow you to enroll any time. We’re going to talk about that in a second.

[00:15:40.890] – David

But there’s only a short period of time each year when you can enroll. Non-ACA-compliant plans, generally, you can enroll any time during the year. The tax penalty is no longer an issue for either type of plan. ACA-compliant plans are eligible for federal subsidies, which can offset a huge amount of your premium. We’re going to go into that in some detail. Non-ACA-compliant plans are not. And so one of the most important things is to figure out are you eligible for a federal subsidy?

[00:16:09.660] – David

And we’ll talk about that. And if you are, really see if there’s a way you can get onto an ACA-compliant plan. The other big downside about the ACA-compliant plans is they are, as we mentioned, very expensive, especially if you can’t get subsidies. Non-compliant plans usually cost less. I mentioned the essential health benefits that an ACA-compliant plan is required to provide. There are ten of them and you see them here on this slide. Non-compliant plans will often omit things like mental health and substance abuse.

[00:16:41.460] – David

Sometimes they will limit prescription drug coverage. Sometimes they will omit rehab services. Sometimes they will omit maternity coverage. And so you really need to look carefully when you’re thinking about a non-compliant plan to understand what’s not covered. I also mentioned with the ACA-compliant plans that you can only sign up during a specific time, it’s called the enrollment window. And why do they do this? Well, because otherwise you could wait till you get sick and then sign up for insurance.

[00:17:16.610] – David

And that means only the sick people would have insurance and rates would skyrocket higher than they have been. So for ACA-compliant plans, there is there are two types of enrollment periods. There’s open enrollment, which if you’ve ever worked at a company that provides health insurance, you’ve heard about, it’s usually November 1st through December 15th. So we’ve got another, what, six days left in this year’s open enrollment for 2021 coverage for plans through the federal marketplace.

[00:17:44.150] – David

Some employers use a slightly different window. Some states have made the period a little longer and some plans, employer-sponsored plans, especially ones by large employer groups, may have different periods. The other type of enrollment is a special enrollment period. And this is important for us as RVers. You get a special period to enroll 60 days from the time that you do have a qualifying life event. And that includes things that don’t happen that often like marriage or having or adopting a child.

[00:18:15.020] – David

But it also includes things that we tend to do, sometimes more frequently or more easily, things like moving. If you change your domicile, you have moved to a different state and you are entitled to a special enrollment period. Any time that you move, you don’t have to wait until open enrollment to other things that can trigger a special enrollment period, involuntary loss of other coverage. Note the word there: involuntary. So this would be things like job loss, or divorce, where your spouse is providing the coverage,

[00:18:45.680] – David

COBRA expiration, aging off a parent’s plan if you become 26. It does not include voluntary termination. So you can’t just decide to terminate the plan you’re on and you get a special enrollment period. The other one that’s pretty interesting is a change in income. And this is true if you’re working with insurance on the federal or state marketplaces. You have to estimate your income at the beginning of the year. If it turns out that your income is going to change substantially, you get a raise, you get a bonus, you lose your job or anything like that,

[00:19:15.800] – David

you’re entitled to a special enrollment period which allows you to go in and either subscribe to a new plan or change to a different plan, if that’s what you want to do. So keep those in mind. There is a lot of flexibility outside of just open enrollment. All right, so with those concepts out of the way, let’s look at some of the options that are available to us as RVers, and these are the ones we’re going to talk about.

[00:19:40.620] – David

I’ve grouped them into ACA-compliant options and non-compliant options. So the ACA-compliant options are group or employer provided coverage, COBRA continuation coverage of group coverage and individual major medical plans. And that includes coverage that you buy on a health insurance exchange, your healthcare.gov or state exchange. Those are all individual major medical plans. Non-compliant plans are things like short term medical fixed benefit, also called indemnity plans, and healthcare-sharing ministries or health-cost-sharing ministries.

[00:20:16.860] – David

And we’ll talk about each of those in a little bit of detail. So let’s look first at the group coverage. This is what you have if you have a job and your employer provides you with health insurance, it’s almost always going to be ACA-compliant. It’s subsidized, but not by the federal government. It’s subsidized by your employer, at least your employee coverage is. Dependent coverage usually is not, except for some very generous companies. Whether there’s nationwide coverage varies depending on the policy that the employer has picked.

[00:20:52.100] – David

Basically, if you have group coverage, you’re generally going to want to keep it. There’s very few reasons to ditch group coverage. If it’s available to you, it will usually be better and less expensive than anything else you can get. Here’s a catch. If it’s available to you, but you decline it, you are not eligible for subsidies under the Affordable Care Act. And this applies not only to you as the employee, it also applies to all your dependents who would be eligible for coverage with your employer had you elected that coverage.

[00:21:23.030] – David

So it’s real risky to decline your group coverage if you’re currently employed. There is an exception called the Affordable Coverage Rule, which we’ll look at. It does not come into play very often, particularly if you have dependents who you’re covering on your insurance. But every once in a while that will come into play. So the second type of ACA-compliant plan is going to be COBRA continuation coverage and you have to be employed or have been employed to have this.

[00:21:55.460] – David

This is what happens when you leave your job. COBRA, which is a federal act, requires most employers, if they have 20 or more employees, to offer continuation of health insurance coverage to all terminating employees, regardless of the reason that they were terminated, fired, laid off, furloughed, retired, quit voluntarily. Any of those, you are entitled to COBRA. If your employer is above 20 employees, COBRA coverage lasts up to 18 months. It has a bad rap because it’s like, oh, it’s so expensive.

[00:22:30.740] – David

And it probably is for the employee compared to what you were seeing in payroll deductions because your employer is no longer subsidizing it. But it’s still with dependents, basically not any more expensive unless your employer was subsidizing that coverage, too. They do have the right to add a two percent administrative fee, but that’s really not going to make a huge difference. So don’t ignore COBRA coverage automatically. You may already be bearing most of the premium cost as an employee, and it may not be that much more expensive.

[00:23:01.220] – David

You have 30 days after your termination during which to collect COBRA. And in that period of time, you can look at other plans. You can change to a different plan from your employer. You can change to a non-employer plan. So look at all your options. One thing to understand is unlike group coverage, if you have COBRA available, but you opt not to take it, that does not disqualify you for a subsidy. However, if you elect to take COBRA, you are no longer eligible for subsidies until either your 18 months has run out or the next open enrollment period.

[00:23:44.450] – David

So be very careful when you’re making an election. Understand what your options are, both from your employer and otherwise. The third category of ACA-compliant plans is individual major medical plans. And these are the ones that most of us– because our employers don’t necessarily offer health care coverage, may be working part time, we may be retired early– this is what most of us are going to be looking at. If it says major medical, that generally means that it is an ACA-compliant plan because it offers at least minimum essential coverage.

[00:24:21.050] – David

OK, we’ll talk about the subsidies here and in a separate section. The problem with most of these plans or one of the problems with most of these plans is that very few of them offer a nationwide provider network. And so you have to really check into that to find out whether they do or not. The other problem is that the availability of these plans varies greatly by state. And I’m not well versed on every single state. So you need to look at your current state of domicile.

[00:24:49.370] – David

I can tell you that of the three states that are most popular with RVers for domicile, those being South Dakota, Texas and Florida, only Florida offers PPOs on the marketplace, individual major medical plans that have nationwide coverage. Texas does not. That’s not to say you might not be able to find an individual non-subsidized plan through a broker that offers nationwide coverage, but it’s likely to be very, very expensive. So those are the compliant plans. Now let’s look at the non-compliant plans.

[00:25:24.660] – David

Now, remember, these aren’t regulated as much. They don’t have to provide all the same benefits, but in exchange, they have a lot more flexibility. But it really is buyer beware. You have to understand what you’re buying. So the first type and the one that you’ve probably heard a lot about over the last couple of years is short term medical plans. These are also now, in marketing speak, insurance marketing speak, called try term medical plans, because that sounds better than short term and because the length of time that you can have these was expanded by the Trump administration up to 36 months from 12 months.

[00:26:00.540] – David

So three terms of 12 months gives you try term. All of these plans provide limited benefits so that they usually almost always will exclude pre-existing conditions. They’re going to have a relatively low lifetime cap. They’re not going to provide all essential health benefits. But what they’re intended to be used, or what they were originally intended to be used as, is a bridge between employer coverage and some other coverage, either another employer or Medicare.

[00:26:28.530] – David

They were never really intended to be permanent health insurance. And so that’s why they provide just kind of minimal coverage. They always have a limited term, up to 12 months. But some states restrict the term to three or six months that are renewable up to 36 months as I mentioned. One of the things that you’ll see with these, and it’s true for most of these non-compliant plans, is that they’re subject to underwriting. Underwriting means they’re going to ask you a lot of health questions before they accept you into their insurance program.

[00:26:57.390] – David

They’re going to ask you, have you ever been diagnosed with diabetes? Have you ever been diagnosed with asthma? Have you ever had cancer in your life? Things like that. And your answers will determine whether or not they will accept you into the plan and how much they’re going to charge you. Unlike in the ACA-compliant plans where everybody has to be charged the same rate other than based on age and smoking history and gender, a short term plan can charge you upcharge you if they want based on your pre-existing conditions or your past health history.

[00:27:28.860] – David

Another thing you have to watch out for with these plans is what’s called back end underwriting. And what that means in the industry is they’ll ask you some simple, easy to answer questions up front when you apply, things like do you smoke and things like that. But when you submit a claim, they’ll start digging into your health history to find out if there’s any chance that maybe the injury or illness that you’re claiming for is due to a pre-existing condition and if so, they will exclude it from coverage.

[00:28:00.390] – David

That’s a pretty ugly surprise to get once you’ve already suffered the illness or injury. So you really have to be aware of that and be sure, just go into it understanding that if you have something that arises from anything that could be considered a pre-existing condition, the insurer may refuse to cover. Short term plans are available currently in 40 states. There are 10 states that have said “we’re not going to do this because they’re really not very consumer-friendly”. But it’s an option to think about.

[00:28:31.620] – David

Also understand that when you renew these, there’s no guarantee on most of these plans that the insurer will renew you and there’s no guarantee that your premiums won’t go up. So there’s a lot of risk involved with this. A second option for non-compliant plans and one that’s kind of interesting is fixed-benefit plans. These are also called indemnity plans. And you may think you don’t know what these are, but you have seen at least one, I guarantee you, on TV, because that’s what AFLAC is and everybody has seen the AFLAC duck.

[00:29:01.530] – David

AFLAC is a fixed indemnity plan where they pay you cash when you are sick or hospitalized and have to miss work. And I’m not even sure missing work is a requirement. So basically the way fixed-benefit indemnity plans work is there is a schedule of illnesses and injuries and a fixed dollar amount that they will pay you for each one. So, for example, a plan might say “we will pay you $100 per physician visit. We’ll pay you $3000 per day of hospitalization.

[00:29:31.770] – David

We will pay $5000 toward surgery” and so on and so on. It’s a long schedule. We’ll look at one of those. Basically, most of these plans allow you to adjust how much you get paid by the insurer for each event. Obviously, the higher benefit you opt for, the higher your premiums are going to be. National coverage with these is usually not an issue because the insurer does not care about where you get the service because they’re going to pay the same amount regardless.

[00:30:01.290] – David

And so most of these plans allow you to see any licensed doctor or hospital in the country. An important difference and something to look at if you go to look at these plans, some of the fixed benefit or indemnity plans also give you access to a managed care network, like PHCS, there are a number of other ones. Managed care networks contract with providers to offer their services at a discount, and if you can get a provider in a network at a discounted rate, that’s going to put you pretty far ahead.

[00:30:33.020] – David

We’re going to look at why in just a second. Most of these plans require some simple underwriting, but generally are not subject to back end underwriting. Of course, your mileage may vary depending on the provider. I mentioned the benefits schedule and this is what one of them looks like. This is a benefit schedule from a couple of years ago from a United Health care fixed indemnity plan that was being marketed to RVers. And honestly, it was, if you absolutely cannot afford true insurance, this was probably one of the next best things.

[00:31:08.080] – David

It’s a real insurance company. There’s no question that they will pay the benefits that they’ve provided. And you can adjust how much risk you want to take on by how much premium you’re willing to pay. There’s usually multiple tiers of benefits for each of the different services that are covered. So I’ve kind of alluded to the risk of fixed benefit plans a little bit, and this is a little bit hard to understand. So I did this graphic to help convey it.

[00:31:39.440] – David

Fixed benefit plans are not insurance. Even if it’s called indemnity, it’s still not insurance. True insurance, remember, is there to cover the catastrophic costs. So with true insurance, you pay the first dollar, actually more than the first dollar, some amount which is fixed as defined in your insurance contract, and that’s your co-pays, your deductibles, things like that. And then the insurance is going to pay everything above that amount, regardless of how much it is.

[00:32:12.040] – David

Fixed benefit plans work just the opposite. The plan pays a fixed amount first for each covered event, so they have the first dollar liability and then you are responsible for everything above that amount, no matter how much it is. And so it’s exactly the opposite of insurance. So the risk with a fixed benefit plan is that you, if you have something really serious happen and you didn’t buy enough coverage, you could be responsible for a large amount. However, you can mitigate that, first of all, by making sure that you buy a meaningful amount of benefit.

[00:32:50.620] – David

So don’t go just for the cheapest option. Make sure you purchase, you know, find out what a typical hospital stay costs, find out what a typical surgery costs, and purchase enough coverage to cover the average thing. The other thing is that with a fixed benefit plan in your pocket, you’re in a better position to negotiate with the provider than you are if you have no insurance at all. You can go and say, look, I know you charge me $5000 a day for the hospital room.

[00:33:22.030] – David

My plan only pays four thousand. I can’t really afford to pay the difference. Will you take four thousand? And it may be a little bit of a give and take, but a lot of times hospitals, other providers will write off some of that expense if they understand that you can’t pay it. Now we come to health cost sharing ministries, and this is a sticky subject. So what is a health cost sharing ministry? Basically, there’s like a million people who have subscribed to these, and they were originally created for certain religious communities that objected to traditional insurance.

[00:33:56.060] – David

But they’ve been expanded now to be open to the general public. And how they work is members of the ministry contribute a share, which is more or less like a premium payment, monthly. And all that money gets put into a pool and then the ministry pays member claims out of that pool. Most of these, because they are religious-based in some way, require you to say that you will follow a common set of religious or sometimes ethical beliefs.

[00:34:28.100] – David

It may be something as simple as belief in a higher power, or it may be something very specific, being willing to live your life according to Catholic principles or something like that. And so you have to look at that and see if that jives with your own beliefs. There are a couple of advantages to these plans. One is that the sheer amount, which again is like a premium, is usually less than what you would pay on an unsubsidized individual major medical plan.

[00:34:55.670] – David

And the other thing is most of these ministries do provide you with access to a provider network so that you get the benefit of the agreed discounts up front which limit your exposure and obviously the plan’s exposure as well. But as you may have inferred from what I’m saying, these plans come with a number of risks. And for that reason, they’ve really been carefully scrutinized by many states. Right now, they are not subject to federal regulation and there is little or no state regulation.

[00:35:27.620] – David

They’re actually exempted from the Affordable Care Act because they’re religious-based. And although some states are starting to regulate them, you don’t get the consumer protections that are available from a heavily regulated insurance industry. One of the things that scares me is there’s no guarantee of payment. It depends how much money is in the pool when you make your claim. If you have a big claim and the pool has shrunk a lot because there are a lot of other big claims that month, you may only get a partial reimbursement or you may get none at all.

[00:35:58.580] – David

Or you may get told you have to wait six months until there’s more money in the pool. We know people this has actually happened to. There’s a lot of people who have had great experiences with health cost sharing ministries, but there are some who have had downright scary experiences. And again, because it’s not regulated, there’s nobody standing behind the ministry to make sure they actually can pay. They usually provide little or no coverage for pre-existing conditions.

[00:36:23.990] – David

Generally, it’s covered only if the condition was cured at least one to five years ago, depending on the condition. If you have a chronic condition like diabetes or asthma or something like that, that never really goes away. You’re never going to have coverage for that or other conditions arising from it. And so you have to really think about that. HCSMs can charge higher rates or decline membership completely based on your health status. So they do a form of underwriting up front.

[00:36:52.460] – David

They offer limited services because it’s just not economical for them to offer all the essential health benefits. So they usually exclude things like mental health care, preventive care, and they usually limit or exclude prescription drugs. They almost always have a cap to protect themselves on the amount that will be paid annually. And during your lifetime, they may have exclusions related to beliefs of the group. For example, if you’ve said “I’ll abstain from alcohol” and you go have a couple of drinks and you’re in a car accident, they might say “No, you said you would abstain from alcohol.

[00:37:30.020]

We’re not going to cover your injuries as a result of the car accident because alcohol was involved.” And then finally, not all providers will accept coverage because this isn’t really insurance. There’s no guarantee of payment. The provider very often will require you to pay up front and then get reimbursed by the ministry so that you are taking the risk rather than them. So they really are, as this quote says, a leap of faith, both literally and figuratively.

[00:37:59.540] – David

They might have their place because they’re better than nothing. OK, so we just finished talking about health cost sharing ministries. Now we’re talking about ACA subsidies. When we talk about a subsidy, we’re talking about a premium tax credit. And what this is, is an amount that is based on your income and it’s a dollar for dollar reduction in your income tax. But you can actually get it ahead of time called the Advanced Premium Tax Credit, and you use it month to month to offset your health insurance premium bills.

[00:38:35.510] – David

So it has the effect of reducing your premiums that you pay for your insurance. You have to estimate your income at the beginning of the year and your income has to be between 100% and 400% of the federal poverty level. Don’t let that word poverty scare you. It is just a number that they use as a reference point to determine whose middle-income enough to be able to take advantage of this figure. And I’ll show you what the figures are here in a second.

[00:39:07.050] – David

You do have to reconcile it on your tax returns. You have to file a tax return and you have to say, here’s what my actual income was. Here’s the advance that I got. And if you got more subsidy than you were entitled to, you’ll have to pay it back. If you didn’t take enough subsidy because your income was lower than projected, then you actually get an additional credit on your tax return. So it works both ways. And there’s a limitation if you underestimate it, there’s a limitation on how much you have to pay back as long as you don’t go over that 400% maximum, which is called the Obamacare cliff.

[00:39:39.060] – David

And we’ll have a slide on that. So what do subsidies do for us? This is a hypothetical family to adults, no children, both age 55, nonsmokers in Sumter County, Florida, where Escapees has the park that a lot of us use as our domicile. It’s an unsubsidized silver plan or it’s a silver plan that had a premium of $1606 a month. And there’s two parts to this graph. The the blue line with the circles shows the premium, the amount of premium tax credit that you’re receiving as a function of income, which is on the horizontal axis of the graph.

[00:40:14.940] – David

And you can see that as your income goes up, the amount of premium tax credit you get goes down, but it doesn’t go to zero. It only drops about 30 percent. The part of the graph on the bottom, the bar chart shows your estimated net premiums. So that’s the $1600 a month, minus the premium tax credit you’re getting. And you can see that even at the highest income levels, that would qualify for a subsidy.

[00:40:42.840] – David

That makes the $1600 plan pretty affordable at $541 a month. So those subsidies are critically important if you can qualify for them. So let’s talk about how do you qualify for them? So there’s three main requirements. There’s an access test, access to employer-sponsored coverage. There’s an income test and there’s a Medicaid or CHIP test. There’s a few other requirements, but I’m not going to talk about those because they won’t be of concern to most RVers.

[00:41:12.630] – David

So this first one is the access test, and this is one that’s a little tricky. The test says you must not have access to affordable employer-sponsored coverage. And we think, “Great, none of the coverage my employers are offering is affordable. Therefore, I’m entitled to subsidies.” Not so fast, because our definition, the common-sense definition of what’s affordable, is not the federal government’s definition of what’s affordable. So first of all, the access part, you have access if it’s available, whether or not you accept it.

[00:41:44.090] – David

Remember that if you decline employer coverage, you are not eligible for ACA coverage. The affordability coverage part works like this: the plan that your employer provides has to provide what’s called minimum value, which means it has to cover 60 percent of average cost. Most plans do. It has to cover at least inpatient and physician services. It does not have to cover all 10 essential health benefits. So most plans meet that. And then here’s the sticker.

[00:42:13.560] – David

The employee only premium for the lowest-cost plan offered by that employer must not exceed 9.83% of your household income. And that figure changes slightly each year. Now, notice that we’re comparing the employee-only premium to the income of the household, which means that if you have a spouse and they work, their income gets counted. However, the cost of their coverage does not have to be affordable. And this is called the family glitch.

[00:42:48.780] – David

It was a compromise in Congress to get the ACA through back when it was originally passed. And what happens in the family glitch? This does not affect you if you are solo, if you’re a single person, you have no dependents. You don’t have to worry about the family glitch. But if you have dependents that you want to cover on your plan from your employer, the affordability of that plan is based on the employee-only cost, not the family cost,

[00:43:13.620] – David

but you still have to pay the family cost because your employer is not going to pay it. But you get to count your spouse’s income. And so what happens is in this glitch, the entire family ends up being ineligible for subsidies if the employer offers at least one plan, that you have access to, that is “affordable.” Employers get penalized if they don’t offer affordable plans. And so what they started doing is they’ve offered most employers will now offer a bare-bones, minimal plan that just barely meets the ACA requirements, but really has very, very limited benefits.

[00:43:56.990] – David

And they’ll offer that at a rock-bottom price that is almost guaranteed never to exceed that 9.83% of anybody’s income. And by doing that, they take advantage of this and they don’t end up getting penalized. But it means that you may be eligible for employer coverage. You can’t decline it and be eligible for subsidies. And you can’t take it and cover your dependents because it’s too expensive.

[00:44:25.970] – David

So that is a real problem that hopefully Congress will fix at some point. The other two tests are a little more straightforward. The income test is your income has to be between 100% or 138%, depending on which state you’re in, up to 400% of the federal poverty level for the size of your family. And when we’re talking about income, there is a term ACA modified adjusted gross income, which is basically your 1040 adjusted gross income, plus a few other things that probably won’t apply to most RVers.

[00:44:59.360] – David

But you do need to be aware of those. Now, I mentioned that 100% versus 138%. Which threshold is used as the bottom level for income? Depends on whether or not the state where you’re getting the insurance has expanded Medicaid. Thirty-six states and the District of Columbia have expanded access to Medicaid. So they now allow low-income people to participate in Medicaid up to 138% of the federal poverty level.

[00:45:29.630] – David

The idea being that if you’re eligible for Medicaid, you’re not eligible for subsidies. And then there’s a few more states that are expected to join them in 2021. So you need to know which state you’re in to know what the bottom threshold is. The income levels for subsidies are on the slide and these are 2012. Let’s say I left off one other thing, let’s see, which is there’s a third test where I think the slide is missing, which is you can’t be eligible for Medicaid or CHIP, the Children’s Insurance Program, which again are for low-income people.

[00:46:03.050] – David

OK, so these are the income levels for ACA subsidies. I see, I skipped a page. These are the 2020 federal poverty level guidelines that are used for determining 2021 subsidy. So they always look back to the previous year. Basically, the way you use this chart is, you find the number of people that you plan to cover on the left side. You look at one of the first two columns to determine the minimum amount of income you have to make, depending on whether your state has expanded Medicaid,

[00:46:36.830] – David

and you look at the last column, which is the one people most are concerned about, to determine the upper income limit for your family size. And as long as you fall in between those two, you are eligible for a subsidy under the ACA. All right. I talked about the Medicaid CHIP test, which is the third eligibility qualification. Now, I alluded to the subsidy cliff, or the Obamacare cliff, that you really need to be aware of.

[00:47:11.960] – David

And I have personal experience with this. Unfortunately, I mentioned that as your income goes up to 400 percent of the federal poverty level, you don’t lose all the subsidy, you lose only about a third of it. So you can see that inflection point pointed to by the red arrow. That’s the Obamacare cliff. And when you go one dollar in income over that, you lose 100% of the subsidy. What that means is if you’ve been taking the advanced premium tax credit, when you file your tax return, you get to pay back over $10,000, usually in tax credits.

[00:47:49.400] – David

And that happened to me last year. Got a small bonus from a company that I used to work for that wasn’t expected on December 26, and it pushed us over the subsidy cliff. And I got to write a really big check to the IRS. Not the happiest day. So just make sure that you manage your income so you don’t go over that. All right. So if your mind had already exploded, let’s think a little bit about how to choose from among these different options.

[00:48:19.220] – David

And look, this is my own opinion that I tried to put down in this decision tree as a layperson for how to at least start going about this. It is by no means dogma. You should look at all the possible options. But here’s how I would approach it. First of all, are you employed or not? If you keep your group plan, that’s almost always going to be the best option. If no, then run through the three ACA subsidy tests and look at your income and determine if you’re eligible for a subsidy, potentially assuming you can find a satisfactory plan.

[00:48:53.730] – David

If you are, then I would seriously look at changing domicile to Florida or to some other state that has an RV-friendly plan that is ACA-compliant and eligible for subsidies. Florida is the most popular one for RVers. If you’re in Florida, use the Florida Blue PPO. It’s really some of the best insurance we’ve ever had. Honestly, I can’t believe I’m saying that. But it’s true. If you can’t domicile in Florida, then look at your state’s marketplace, pick a plan from there that can be subsidized. If you really need to maybe look at adding an indemnity plan to fill in any gaps.

[00:49:36.270] – David

We are in the Florida Affordable Care Act plan. We have been since the beginning of 2018 and we’re subsidized, except for the one year that we ran over the cliff. And so it’s worked out really very well for us. All right. If you’re not eligible for a subsidy, then I think the next question you want to ask yourself is, do you have a serious or chronic pre-existing condition that’s going to make you ineligible for a lot of other kinds of products?

[00:50:03.240] – David

And if you do, I would look at COBRA, if you’ve recently terminated employment. Or, figure out some way to get into a marketplace plan, Florida or otherwise. This is a situation where you may just have to bite the bullet. You may just have to bite the bullet and and pay an unsubsidized premium if you have to. But so there’s a lot of different combinations of products you could use. If you don’t have a serious or chronic pre-existing condition,

[00:50:35.310] – David

you have other major health issues, again, COBRA, if you can. Otherwise, if it’s not a pre-existing condition or a chronic condition, but you think you’re at risk of something, you might look at a health cost sharing ministry or look at short term medical, but with guaranteed issue, something that you can’t be declined for. Only if you don’t have any other major health issues. This is the young and healthy RVer. Look at off-exchange individual major medical that you’ll be able to qualify for through the underwriting process or a fixed benefit plan or a cost sharing ministry.

[00:51:14.490] – David

As you can probably tell, I look much more favorably on true insurance products than I do on some of these alternative project products that aren’t really insurance, if you possibly can afford it. How do you go about shopping? I would start your journey at healthcare.gov, or at your state’s marketplace, if there is one. You can still go to healthcare.gov and it will direct you to your state’s marketplace, particularly if you think you’ll qualify for subsidies.

[00:51:40.740] – David

There’s a calculator in there that where you don’t have to do an insurance application and you can see if you’ll qualify for subsidies or not. There are online portals like ehealthinsurance.com, if you really know what you’re doing.

[00:51:51.090] – David

But, if you’re really not sure, I would seek out a licensed insurance broker in the state where you’re domiciled and ask them to compare options from several different companies.

[00:52:02.850] – David

You don’t want to go to a broker or an agent who can only write insurance for one company. You want somebody who has products from several different companies and can offer you different things. And different brokers work with different companies. So you may need to shop around for the best deal. And like you would with any other high dollar purchase, check the brokers’ consumer ratings. You should be able to find them on various sites and see if other people have had good experiences with that broker.

[00:52:32.640] – David

You ask around the RV community. There are a few brokers who do specialize in insurance for RVers and you can get recommendations on them. And then, as I mentioned in the PDF, there are links to some general resources, some things that I’ve talked about here, and then a number of resources about subsidies under the Affordable Care Act that I encourage you to take a look at. And with that, if anybody’s brain isn’t full at this point, I don’t know how to fill it.

[00:53:07.920] – David

But I that’s the end of the presentation. And let’s address some of these questions that have come up. Yes.

[00:53:17.350] – Georgianne

Thank you so much, David. I know I’ve heard you give this presentation before, and you’ve updated it since I last heard it, but there’s always really great and useful information. And thank you so much! I’m very grateful that I have coverage through my employer, but there are plenty of people who are not in that position. And so, thank you so much for this. Alright, to go back to some of our earlier questions. Well, actually, first of all, let me do a little bit of housekeeping again.

[00:53:42.790] – Georgianne

I’ve seen the numbers of viewers fluctuate quite a bit. And so if you’re joining us later on after we started tonight’s presentation, don’t worry, the recording will be up on Facebook pretty quickly after we finish the live broadcast. You can go back and watch what you missed. Also, we will upload the recording to our YouTube channel. Escapees RV Club has a YouTube channel. We’ll put it on there later this week, potentially early next week, and also be added to the webinar archive on our website.

[00:54:10.210] – Georgianne

And so if you missed part of it, don’t stress. You can definitely get that information still. And David also made his slides available, Jeannie’s been posting them in the comments here. But, in case you want to reference them later, it’s the link just yet. There will also be included. That link will be included whenever we have the upload later. So we’ve got you covered. Don’t stress.

[00:54:31.060] – Georgianne

But now to answer the questions.

[00:54:33.520] – David

You have six days left in open enrollment, so.

[00:54:36.580] – Georgianne

1. Yes. All right. Good point. So we will uploa them sometime soon.

[00:54:45.630] – Georgianne

And so, a comment that Caroline made earlier on when you were talking about people considering their risk. Don’t forget things like accidents, injury, trauma, that sort of thing. It’s not always just ongoing health concerns.

[00:54:58.150] – David

Exactly. And those are accidents by definition. You can’t plan for. They’re accidental.

[00:55:04.180] – Georgianne

Yes, definitely. OK. And so Susie has a question going back to when you were talking about the reasons why, the causes, people can pick up insurance, is a life-changing event. Does that include if someone decides to stop working versus…?

[00:55:22.190] – David

Yes. That is a qualifying life event, and it’s life changing in many ways, not just with insurance. But that does entitle you to a special enrollment period or any voluntary termination of employment, unless and until you become eligible for employment for insurance through another employer. But if you’re just going to stop working, which is what I did. Yep, that’s a qualifying event, you qualify for special enrollment period.

[00:55:57.580] – Georgianne

Thank you for that. So thinking about indemnity plans, Elsie has the question, “can you carry a fixed indemnity plan as a supplemental plan to the major medical plan?”

[00:56:08.590] – David

Yes, absolutely.

[00:56:09.850] – David

And that is actually one of AFLAC’smain selling points. So a lot of times what people end up with, because this is what they can afford or it’s all it’s offered, is a plan that has a very high deductible or very high co-pays. And a fixed indemnity plan can actually fill that gap. You might be responsible for $14,000 deductible or some huge co-pays. If you’ve got a limited fixed benefit plan, that could be a good strategy to reduce your exposure to risk in case you do have something catastrophic happen that would have you meet your deductible.

[00:56:52.150] – David

Fixed benefit plans can be good supplements to a lot of different things. And because you can kind of pick your level of benefit based on how much you want to pay, they give you a lot of flexibility. They do have a place, just not necessarily as your primary coverage.

[00:57:07.390] – Georgianne

And thinking about fixed indemnity plans, Richard has a question. If you are covered for a certain dollar amount, but the charge is actually lower, do you still get the difference paid out to you?

[00:57:17.980] – David

Usually, yes. And again, that’s that’s one of the selling points you hear the AFLAC duck talk about. Generally, they don’t require you to turn in receipts. I mean, you have to have some proof that the event actually happened. But if you had a doctor’s visit and the doctor charges you $80 and your benefits $100, you’re going to get $100. Now, don’t get too excited about that because most times the providers are going to end up charging you more than what your benefit is. But if there’s an excessive usually you get to keep it.

[00:57:46.270] – Georgianne

I know from personal experience. This could have been a complete fluke, but it doesn’t sound like it was, when I talked to different insurance companies involved. I personally had to have an MRI several years ago and was required by the facility to pay up front and then they would get reimbursed by the insurance company and issue me a refund, or whatever was due back. Well, in the process, I went ahead and also filed with my indemnity that I had,

[00:58:09.910] – Georgianne

in addition to my major coverage. I got both the full refund from the MRI clinic as well as the full amount of the indemnity. And both were like, “it’s totally fine. That’s not fraud. That’s what your plan is for, so you’re good.” So I actually got extra money in the end.

[00:58:26.110] – David

Yeah, that’s that’s a good point. And the industry term for that is “coordination of benefits.” If you have two group health insurance plans for some reason, or you have some real insurance, not an indemnity plan, but true insurance, more than one plan that would cover the same event, most plans state which insurance has to pay first and which insurance will pick up the excess.

[00:58:57.640] – David

You don’t have that with fixed benefit. Fixed benefit pays regardless of what other coverage you have. So there’s no coordination of benefits with fixed benefit plans and traditional.

[00:59:11.260] – Georgianne

Makes sense. So thinking again, going with all the different things available, we have a question: “what is the largest deductible you can get on an ACA or non-compliant traditional insurance?” They follow-up to say that “we’ve been considering catastrophic-type coverage paired with the telemedicine program.”

[00:59:32.290] – David

OK, that’s a great question. So to answer the question, then I’ll explain a little bit what I think she’s asking, I believe there is a maximum under the ACA on a non-compliant plan. It’s whatever the insurer decides to offer. But I think the maximum under the ACA is pretty high. And the number 13,000-something sticks in my mind. It’s pretty stiff. Now, I want to talk about this term “catastrophic” that Kelly is using because it’s really important.

[01:00:01.750] – David

The strategy that she’s describing is actually a really good one if you feel like you can pay whatever deductible you sign up for. There are a lot of high deductible plans that basically say you pay the first X dollars and the plan plays 100% of the rest. Those are usually HSA-qualified plans, health savings account plans, and they’re called high deductible health plans. People who get those are basically saying, I’m willing to take that first X thousands of dollars of risk.

[01:00:31.480]

I just don’t want the unlimited risk above it. In exchange you’re getting a lower premium because you’re taking on more risk than you would with many other kinds of insurance. So what you’re insuring against is the catastrophic loss, the $1 million, $2 million, $5 million bill, that if something really bad happens to you and you’re saying “in order to keep my premiums down and because I live a healthy lifestyle, I’m a pretty healthy person, I’m willing to take that risk and it won’t it won’t kill me.

[01:01:00.740] – David

I might have to borrow the money. I may have to pay it out over time, but I can manage that $10,000 or $15,000.” So it’s not a bad strategy if that’s what you need to do.

[01:01:13.000] – Georgianne

So I have a couple questions here that are kind of specific to Florida. I know that that’s what you’re most familiar with personally because of the coverage you guys have. So, Carol, just wanted to confirm I’m pretty sure you did say this, that you were on the Florida ACA, correct?

[01:01:24.250] – David

Correct. And specifically around the Blue Select Gold 1835 plan, which after looking for all the different plans, that one had the best balance of benefits and premium cost for us.

[01:01:39.150] – Georgianne

And so she follows that with she recently heard that there’s no longer a nationwide Florida PPO plan. Do you have any insight on that?

[01:01:46.650] – David

So I had heard a rumor to that effect. And there was actually a thread, I think, on the SKP’s group on Facebook today or yesterday, maybe it was on Xscapers where somebody was asking this question… I have actually sat down and looked at Florida Blue’s contract because it’s a contractual relationship between you and the insurer for my plan for 2021 and compared it to 2021. And well, there were some minor differences. There’s nothing in there that says that benefits are no longer provided nationwide.

[01:02:18.690] – David

Now there is a little bit of a catch here and it’s not anything new this year. My plan, and I think a lot of Florida Blue’s plans in Florida are combined PPO and EPO. PPO means you’ve got to use a provider in their network to get benefits. EPO means you have to use an exclusive provider organization. You have to use the provider that they designate and that’s going to be in the state of Florida. There are only a few things on the Florida Blue plans that are subject to the provisions.

[01:02:52.050] – David

One of them is durable medical equipment. My wife and I both use BiPAP machines and so we have to buy supplies for those every quarter. We have to get those through Florida Blue’s contracted provider, a company called Apria Health Care in Florida. Not a big deal. They will send them out to us. They ship them. They even cover the shipping. But we can’t just go down to the local supply store and buy them and get reimbursement.

[01:03:16.380] – David

We must use their Florida provider. So that’s the category, durable medical equipment, and a few other things like prosthetics. I think home health care is an EPO provision in Florida, but for things like that, you would go to Florida if you’re going to need long term care. But generally, most of the benefits that we think about insurance providing for us are going to be, as far as I can tell, available still nationwide through their nationwide provider. They haven’t said anything to change that.

[01:03:48.120] – David

There were several people on that thread who also said that they had called Florida Blue and gotten confirmation.

[01:03:54.480] – Georgianne

It’s good to know. So, thinking about Florida still, but looking more general domicile kind of thing. I don’t wanna get too far into the weeds specific to domicile, but I know that’s, of course, tied very closely to health care. Lori Leonard has asked “if they are working part time in Ohio, can they still domicile in Florida?”

[01:04:15.320] – David

Maybe I would even say probably, but domicile is a really complicated subject that there are so many factors you have to consider. I mean, I’m domiciled in Florida, but I work for Escapees, which is a Texas company. So, yes, possibly. But there’s also a lot of other things that go into establishing my Florida domicile. So the answer is “it depends.” I’d encourage you to look at the Escapees resource page on the website for domicile. Maybe Jeannie will post that.

[01:04:47.510] – David

I think it’s escapees.com/domicile, which would be clever. And there’s a lot of resources there about this question. You can also get a free consultation with consultation with an attorney who specializes in domicile issues, and they can answer a lot of the basic questions and figure out if you need to go into something more deep in order to be able to change your domicile under your specific circumstances.

[01:05:13.870] – Georgianne

Definitely, and domicile becomes a tricky thing, especially if, in your example Lori, you’re talking about working on site part time in Ohio, that could get tricky when it comes to things like taxes, making all of it very messy.

[01:05:27.370] – Georgianne

So definitely when you are looking at something like that, like they’ve recommended, I would definitely seek legal advice on it so that you can be as protected as possible, because you don’t want a situation where the state comes after you later because they don’t believe that you are domiciled the way you say you are.

[01:05:45.190] – David

That’s especially important if you are changing your domicile from a state with income taxes to a state without income taxes, because your home state would really like to continue collecting money from you. So you really have to be very careful. Susie Adams, who is the attorney I was mentioning, is in Livingston. She deals with RVers all the time. She writes articles for the magazine. I don’t think there’s a domicile question she can’t answer. So I’d really encourage you as a member to take advantage of that resource if you have questions.

[01:06:20.920] – Georgianne

Definitely. Another related topic, Mark has asked, if they domicile in one state, can you use family member’s address in a different state for insurance? I know the answer, but I’ll let you answer.

[01:06:31.130] – David

It’s a good question. So as mailing address? Yes. But as your address for determining your rates and your coverage available? No. You have to use the zip code in which you’re domiciled for purposes of picking a plan and the insurer determining the rate. Now Flroida Blue for you. If you’re talking about a mailing address, Florida Blue, for example, if you ask, they won’t volunteer this, but they have a separate field in the profile for mailing address.

[01:07:04.600] – David

And so all of my Florida Blue mail actually comes to Livingston, directly to the mail service without stopping first at Sumter Oaks. But I being domiciled in Florida, I could not use the Livingston address to get Texas insurance. I would actually have to change my domicile to Texas in order to do this.

[01:07:26.240] – Georgianne

So changing gears back to looking for insurance and considering the ACA subsidies and that sort of thing, Lori has a question about what’s considered income or retirement plans or annuities factored into your income.

[01:07:42.070] – David

Yes, usually. So basically, anything that you would report on your income tax return as income, that would go into your adjusted gross income line as income. So that’s going to usually, I don’t have an annuity, so I don’t know that for sure, but if you pay income tax on your annuity payments that you receive, then that’s going to be included in income. If it’s not taxable, then it may not be. Contributions to retirement plans are not.

[01:08:17.410] – David

Money you take out of your IRA is, well, if it’s a traditional IRA because you pay tax on a traditional IRA, you don’t pay tax on withdrawals from a Roth IRA. Depends on the particular vehicle. Basically, if you’re going to report it as income on your tax return, it’s going to be considered income for subsidy purposes. Plus, you will also have to include some things that you wouldn’t pay tax on normally tax-exempt income like bonds, municipal bonds, foreign income, if you have investments or bank accounts in other countries.

[01:08:54.470] – David

There’s one other category that gets handed back to this case, a modified adjusted gross income. I do have some municipal bonds and I was a little surprised the first year I filed my tax returns. I didn’t realize those got counted and I had to write a check that year, 2008.

[01:09:15.860] – Georgianne

Well, we’re talking about how income affects ACA, but this is kind of long and it’s getting cut off, I think, on the screen. So, Scott says he’s going to take he’s going to take 2021 to travel the U.S., so his income will likely be less than the required ACA minimum. Can you explain why there is a minimum and if there is any way around this to qualify or is he stuck with getting one of the other options that you mentioned?

[01:09:40.990] – David

So if your income is less than the ACA minimum, then you would qualify for Medicaid. The cutoff for Medicare, Medicaid, the upper income limit for Medicaid is the lower income limit for for the ACA subsidies. So you’ll qualify for one or the other. The reason it’s that way, and that sort of answers the question about why, the federal government already had a plan in place for people who make one hundred or 138% or less of the federal poverty line figure, that’s Medicaid.

[01:10:17.650] – David

And so they basically said, “look, we’re not going to allow you to double dip. You can get Medicaid or you can get subsidies, but you can’t get both.” As long as you’re staying in the US., I’m not very familiar with the Medicaid system, but you should be able to get most providers, not all providers will take Medicaid, but those who do, you should be able to use outside of your home state because it’s a federal program.

[01:10:40.810] – David

Can’t swear to that because I’m not super familiar with it.

[01:10:45.700] – Georgianne

All right, so thinking about Medicare, Ken has asked, he;s on Medicare, his spous is 62. Will there be any change in researching for the spouse’s insurance?

[01:10:57.250] – David

No. So a lot of spouses face this where one’s older than the other. We’ll actually have this in six years where I’m older than my wife. I’ll be on Medicare for a year while she’s still on an ACA plan. So the only changes, obviously, you’re only looking for individual coverage instead of individual plus dependent.

[01:11:18.130] – Georgianne

All right, thinking about HMO, potentially thoughts on supplementing your insurance with a travel assistance program, particularly if you have an HMO.

[01:11:30.630] – David

That is a good question, Debbie.

[01:11:34.350] – Georgianne

That’s a tricky one. I’ve had an HMO before, too, and they’re really complicated.

[01:11:40.660] – David

Yeah, well, I mean, you can you can pretty much say that if you have an HMO, you’re out of luck outside your domicile state for anything except a true emergency. So let me kind of think this through. An HMO is going to cover you while you’re traveling, if it’s a true emergency. So you’re in a car wreck. You come down with a serious case of COVID-19, something like that, where it’s not feasible for you to travel back to your home state. You’re still going to have coverage.

[01:12:11.180] – David

Those are probably the situations where travel assistance program would be triggered because that’s when you would get repatriated to your home state. So, I guess the answer is, I don’t know. It would depend. We don’t carry a travel assistance program, but that’s just us. I feel like if we needed to have emergency evacuation someplace, partly because we’re on a nationwide plan so we can get treatment anywhere, but if we needed to be evacuated for some reason, I think the likelihood is so low that I’m willing to take that risk, even though it could be very expensive.

[01:12:48.800] – David

I guess it would depend on what situations would entitle you to emergency evacuation with the travel assistance program versus what situations your HMO would not consider an emergency, allowing you to get treatment outside the state. And that’s just going to depend on the two plans. It’s an interesting question. I had not thought about that. There may be something.

[01:13:14.950] – Georgianne

Another question about ACA eligibility. If I’m on a soon to be ex-employer’s insurance program am I eligible for ACA before everything is finalized? Or would I be ineligible because the employer plan is only available to me until things are finalized?

[01:13:37.070] – David

I don’t know the answer to that. I’m going to guess, though, that if you’re eligible for coverage, which you would be until the divorce is finalized, unless I guess the judge orders otherwise, that probably makes you ineligible for subsidies. Can’t guarantee that. But that would be my guess, is that it’s a pretty bright line test. If you’re eligible for employer coverage, you’re not eligible for subsidies.

[01:14:04.680] – Georgianne

Hopefully an easier question, can I pay for insurance premiums with money left in my HSA account?

[01:14:10.980] – David

Far as I know, yes. If you’ve got an HSA account from a previous job or something like that, you should be able to pay for… Your HSA is not limited just to expenses incurred on the associate or while you’re enrolled in the associated high deductible health plan that you had the HSA for. You get to keep that money and use it for health care any time, anywhere, and that includes paying insurance premiums. So as far as I know, the answer is yes.

[01:14:41.600] – Georgianne

All right, we’ve got a question from Jeff. “Is income gross, or post standard deduction?”

[01:14:49.460] – David

It is gross, before deductions, unfortunately.

[01:15:01.100] – Georgianne

OK, Caroline shared some helpful tips throughout the chat here. One of them is “In 2021, the max out of pocket for ACA is $8550 for an individual or $17,100 for a family.”

[01:15:14.810] – David

There you go.

[01:15:16.340] – Georgianne

And she also shared… I’ll read this off. “I think it’s my understanding that if you inadvertently overestimate your income, they do not require you to refund the subsidy. There’s a fair amount about this on the Internet, if you take the time to search. Obviously, make sure you’re looking at reputable resources.”

[01:15:38.780] – David

Let me clarify that. If you overestimate your income, meaning you actually made less than you expected, not only do you not have to refund the subsidy, you’re going to get an additional credit on your tax return. I think maybe what she meant to say was, if you inadvertently underestimate your income, you are required to refund the subsidy, but there’s a cap. And so remember how the… I don’t remember what the amount is exactly, but basically it’s there to prevent, especially for people whose income varies greatly from year to year.

[01:16:18.050] – David

As long as you stay under the 400% threshold, there is a limit. I think it’s $600 per person or something like that. But there is some limit to how much you can have to repay because they don’t want to stick you with the whole bill. Now you go over 400%. They are happy to stick you with the whole bill. All right.

[01:16:38.240] – Georgianne

And she also shared a separate comment that Medicare was pretty much in state only. So be careful about seeking care outside of the state.

[01:16:45.740] – David

OK, good to know. Thank you for that.

[01:16:49.300] – Georgianne

And so with that, Scott followed up to your answer that, yeah, it’s his understanding or desire, he doesn’t want Medicaid as the coverage. He’ll look into estimated income to see what he can do to qualify for ACA.

[01:17:01.540] – David

Yeah. And, Scott, if you’re if you’re close to the cutoff, there are sometimes some other things you can do. I mean, obviously, if you earn a little bit more money. If you have a traditional IRA– this is one strategy I’ve heard people use– when you convert money from a traditional IRA to a Roth IRA, that the amount you convert is recognized as income in the year that you do it. So you’re just moving it between IRAs, you’re actually moving it to a better form of IRA, but it will show up as income on your tax return that year and that may be enough to boost your threshold. That’s that’s one way to do it.

[01:17:39.790] – Georgianne

OK, we have a couple more comments… You guys have any questions? I’ve got a little bit more time still so feel free, fi you have more questions, go ahead and add them to the comments and we’ll get to them. David offered earlier before we started, he figured this would be be a hefty topic, so he agreed to go a little bit longer than normal hour to make sure he gets everybody. So we have a question from Carol Taylor.

[01:18:02.170] – Georgianne

“We are both full time in the RV and we’re both 55 with Medishare. And it’s been great so far covering several things that she lists off.” She says it sounds like an indemnity indemnity coverage through Aflac would be a good addition to their program. Do you agree?

[01:18:19.390] – David

Hard to say without knowing more details on the coverage. If you’ve had a good experience with it and you know you can research the company, you can find out whether they really maintain sufficient reserves, what their claims payment history has been…

[01:18:37.310] – David

If you’re comfortable with that, I don’t know that I would spend the extra money on premiums for an indemnity plan. It just really depends on where your comfort level is. You’ve got some experience with that plan if you’re comfortable with it. I would I would say maybe just roll with that. If you if you start hearing about people’s claims not getting paid in full or company not being or delaying payments of claims, which I’ve heard with some of these share plans, then I would look at some other options.

[01:19:12.480] – Georgianne

Also, Caroline, chimed back in that she  actually did mean overestimate because at the time that she posted it, that discussion was about the minimum you have to make to be eligible for an ACa subsidy. So that’s what she meant you overestimate, you’re over that minimum threshold.

[01:19:27.090] – David

So I got you. So just to clarify, what she’s saying is if you thought you did not qualify for Medicaid, so you’re over the 100% or 138% threshold. OK, and it turns out that your income comes in under that threshold, meaning that if you had done it right, you would have been on Medicaid rather than an ACA subsidy. Yes. In that case, they do not require you to pay back the subsidy.

[01:19:54.560] – David

I think the government figures they would have subsidized you one way or the other anyway. But they’re not going to penalize you if your income falls below 100% or 138% of the FPL.

[01:20:06.740] – Georgianne

All right, we have another question from Elfy know of any plans that would help safeguard against balance billing if they don’t have access to a nationwide plan? Another person, it  may have been Elfy earlier, commented to be aware of balance billing.

[01:20:21.260] – David

Yes. Let’s explain. Balanced billing is when the provider does not have a contract. They’re not in network with your insurance company, if you have insurance. And under the contract… Let me back up. Under a provider contract, the providers agree to only bill a contracted rate even if they would normally charge more and to not bill the balance to the patient. If you’re using a provider that’s not under a network contract like that, they have the right to say, all right, your insurance paid X, we’re going to hold you liable for the balance.

[01:21:01.610] – David

And that’s balanced billing. And the answer to the question is, I really don’t. I mean, if it’s if it’s true insurance, if it’s an ACA-compliant plan and you use a network provider, you should never have to worry about balance billing. Those are two big ifs. If, I think what what Elfy’s getting at here is if you don’t have a nationwide provider network and you have to use your provider outside the network, is there a plan that would help avoid balance billing?

[01:21:37.400] – David

And I think the answer is no. I think any time you go out of your insurance company’s network, you are potentially exposed to balance billing. So it’s something I would talk about with your provider ahead of time if you’re forced into that position.

[01:21:52.530] – Georgianne

And Jason offered some input regarding the… When you earlier answered the question about if HSA could be used to pay premiums, jason offered that, he believes it’s only true that they can be used to pay premiums when it’s for COBRA premium or under certain specific scenarios, but it probably doesn’t apply to plan premiums.

[01:22:15.180] – David

OK, well, Jason is pretty smart guy, so I have not looked into it in detail. But, you know, I would say if you’re thinking about paying your premiums out of an HSA, you definitely look into the plan that you’re planning to pay for and see if the terms of your HSA allow you to do that.

[01:22:38.450] – Georgianne

So I think this is our last question, and it’s a bit of a tough one, to be honest. I did see this come through earlier, but it’s one of those I knew would be a little bit more complicated. I didn’t want it to take up everyone else’s question time. So Debbie is asking, another person did ask also, if we’ve heard anything lately about the potential for associations to be able to provide coverage. And she used Escapees as an example.

[01:23:02.700] – Georgianne

I know I’ve talked with an insurance, a contact we had for insurance, in the last couple of years, about the same thing. But I’m wondering if you had anyone with more current information on it.

[01:23:13.410] – David

Yeah, it’s funny that you should ask, because the first time I did this presentation at Escapade in 2019, I actually had a slide in there about association health plans. There was some recent legislation at that point that looked like it was going to allow associations, clubs like Escapees to offer insurance products to their members without them having to be employees. I talked to an agent because I looked after that. I wasn’t able to find a single association plan that was truly group insurance.

[01:23:49.590] – David

There are associations that will offer individual insurance plans, but they have to be underwritten. And all the other things that we talk about. What we’re really talking about here with an association plan is to have group coverage, group type coverage, that you can’t be declined for and that you get the benefit of group rates but, just by virtue of being a member of a professional association or club or something like that– what this guy told me, it was actually, Georgianne, it was somebody we were talking in that same conversation that we were talking about Escapees getting insurance– is that for whatever reason, I don’t fully understand it, the legislation did not do what it was supposed to do. And it did not actually, when associations went to look to see if they could take advantage of this, they found out that they couldn’t. And I can’t really provide any more detail on that exactly why. But right now, membership organizations and associations can’t really offer true group coverage to their members.

[01:24:52.560] – David

It would be a great thing if they could. I’m sure there’s lots of reasons that the insurance industry doesn’t want that. Or maybe they do. I don’t know. I’m not sure what the what the hold up is.

[01:25:04.200] – David

But in any case, right now, I haven’t heard anything about that change.

[01:25:08.670] – Georgianne

The information I was given, which is a little bit more dated than what  you’re talking about, because whenever I had this conversation with the insurance representative, it was it was in the early phases of that proposition being discussed and put together. So, it hadn’t even made it to to a hearing yet. But one of the big hangups between organizations being able to do that is, I believe with insurance companies, it’s a huge liability on their part to offer group coverage to opt-in organizations where you can choose to join this organization solely to get the insurance coverage that they offer.

[01:25:46.290] – Georgianne

Whereas when you do it through an employer, your primary purpose is actually the job, employment, the paycheck that you’re getting, the work that you’re doing, the insurance is a benefit of that. But when they offer it to voluntary organizations where you can choose to become a part of the organization, their liability is much higher because you can join that organization, get that insurance started, and as soon as you’re done with whatever you need the insurance company to pay out, you can bail.

[01:26:12.450] – Georgianne

And they’re stuck with your bill, but no more premiums from you to help offset that.

[01:26:18.330] – Georgianne

It feels a little shady in some ways, but also makes some business sense in others. And so I am not an insurance expert by any means. You know, way more about this than I do. But that’s the little bit that I do know about that particular question. I can say that we have looked into it several times. That’s actually part of the conversation where I learned that originally was talking about the options and talking through some things.

[01:26:40.350] – Georgianne

But it becomes… it’s just it’s a weird gray area that insurance companies don’t have a lot of incentive to offer group coverage to opt-in, to voluntary opt-in organizations and things like that.

[01:26:54.980] – Georgianne

And the question here, “what about when Christian organizations provide group insurance?” I’m not sure if you’re referring to actual group coverage insurance or if you’re talking about health care plans like what David was discussing earlier on. But I think even in that situation, it could be depending on how it’s set up, it could be that the same idea with an employer, that someone’s part of the organization for reasons not related to the insurance and the insurance is a perk not a  purpose. Whereas other organizations… if it gets… I’m kind of talking in circles here for myself.

[01:27:29.440] – David

I’ve never heard of that, but I suppose exactly what you were saying is is possible.

[01:27:36.490] – David

But I, I really think you have to, it has to be an employer group in order to qualify for true group coverage. I mean, there are a lot of organizations that offer what looks like group coverage. Like I mentioned, I’m a recovering attorney, still a member of the Texas bar, and every year I get solicitations from them. “Join the Texas Bar Group Insurance Plan.” And it’s not insurance. I’m sorry. It is insurance. It’s not group.

[01:28:01.270] – David

Every person gets individually underwritten and rated. That’s not group insurance. It is a benefit, supposedly lower premiums, of being a member in the organization. But it’s not true group coverage.

[01:28:16.220] – Georgianne

All right, thank you for that. Thank you for that clarification. That definitely added to what I was stumbling over.

[01:28:26.390] – Georgianne

That is the the questions that we’ve had so far, we’ve got them all covered. There are a couple of offers in here for you for. Thanks for the information. They owe you a steak dinner. There have been lots of people have had to drop off. So fantastic job. Also, I echo that. Thank you so much, David, for taking the time to go through this and the time to put all that information together.

[01:28:44.790] – Georgianne

I know it’s not an easy topic to research so deeply. Appreciate you taking that time to share it with people.

[01:28:50.300] – David

Happy to do it. Hope it helps. And good luck out there. Remember, if you’re thinking about getting on to an ACA plan, open enrollment ends in six days. So don’t miss that date because you don’t get another chance until next year.

[01:29:06.440] – Georgianne

And as a reminder, we will have the recording of this up pretty quickly. You’ll be able to access the recording on Facebook very quickly after after the broadcast is done. It just takes takes a couple of minutes to load it and you’ll be able to rewatch the beginning of it. Also, David, the link to David’s slides so you can look at those. For those on a time crunch, the six-day kind of thing, those are your immediate options to go and get more information.

[01:29:30.440] – Georgianne

And then we’ll also have the recordings up on our YouTube channel and on our webinar archive on the Escapees website. And so we’ll have that for you soon. Thank you all for joining us. Also just a quick reminder that we have our virtual camp fire coming up still this month. Next week, we are actually going to have some of our leaders on here to talk about the Peterson Spirit Award. Some of you may not be familiar with that, but that’s a program we launched last year, early last year, as a way to recognize members who really go over and above to contribute to the community.

[01:30:02.180] – Georgianne

It’s actually named in honor of Joe and Kay Peterson, the founders of Escapees. And so we’ll be talking a little bit more about that and hopefully some of the recipients who have already gotten it will share some of the wonderful things that they’ve done. And also, we’re going to take a break for the Christmas week. But after that, we’ll come back and we have another virtual campfire with plans to talk about gadgets for RVers because RVers love our gadgets. We did a presentation on this recently with  RVers Online University, and it was a really popular topic.

[01:30:34.960] – Georgianne

I’m excited to hear more from Mark about the gadgets and the things that he has found in his travel experience. So thank you all again for joining. Thank you, David, for your time tonight.